Wake-Up Call: Embrace Change!
- Published: April 01, 2007, By By Yolanda Simonsis, Associate Publisher/Editor
Woke up March 28 and followed my slow-moving morning rituals to attend yet another conference, this one only minutes from home. Then the keynote speaker held a disturbingly loud alarm clock directly against my ear!
This year's Global Release Liner Conference, organized by AWA Alexander Watson & Assoc. at the Hyatt in Rosemont, IL, March 28-30, followed a traditional conference/tabletop program sequence, but several of the speakers were anything but your standard fare on a typically benign subject. On the contrary, speakers issued a definite wake-up call, delivering a message never clearer or more resounding: If you're not among those imposing change, then you're among those implementing or accepting it.
It's not enough, however, to merely accept change, said keynote speaker Neil Burns, managing director of Technical Products & Release for Mondi Packaging Coating GmbH, Heerlen, The Netherlands. In today's converting industry, neither is there enough product development, meaningful partnerships, understanding of the business, specialization, or investment. All this in addition to the external challenges of rising paper prices, paper company repositioning strategies, rising prices of platinum and other catalysts, market consolidation, globalization, and unfavorable exchange rates.
What all these challenges require, said Burns, is that we need to embrace change more. He quite effectively pointed out via a Charles Darwin quote: “It's not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.”
Understating the obvious, Burns observed, “We're not a ‘sexy’ business!” Predictably, the audience responded with accepting laughter. So it's mandatory, Burns continued, when it comes to managing people “that we work hard to attract the best people. Then we need to train them and create the right environment for them to work in. Next we need to reward performers, and if someone isn't pulling their weight in the boat, then they're a passenger, and we need to remove the non-performers.”
These seemed harsh words for challenging times with accelerated consolidation occurring practically everywhere — not just with our competitors but our suppliers as well.
Jonathan White, president of investment banking company Thomas Blaige & Co., Chicago, IL (specifically for plastics, packaging, and chemicals), echoed Burns' observations: “Forces in the marketplace are not relenting and are forcing companies to adapt strategies and tactics to survive and prosper.” Particularly in the release liner industry, mergers and acquisitions have become “an essential strategic tool for leaders throughout the supply chain.”
White noted over the past five years $500+ billion of private equity funds were raised to fuel M&A activity, 50% of it representing cross-border transactions with 37% of the transactions going to China. Why is so much capital available? White believes it's because there have been few loan defaults, so banks are willing to make money available.
And what does all this consolidation say about the health of the industry at large? Burns: “There's work to be done. I think consolidation will help pave the way toward a healthier industry.” White: “At the end of the day, it's heathy, and there's an inevitable need to maintain balance. The market can't be sustained by smaller companies.”
The message: Find the best way to work with consolidation. It's not going away.
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